BEIJING - China would consider letting its currency move more freely if necessary although it is comfortable with current settings, the central bank governor was quoted Monday as saying.
China will gradually widen the band within which the yuan is allowed to trade, Zhou Xiaochuan, the head of the People's Bank of China, told journalists in Cape Town, according to the official Xinhua news agency.
"The floating band is okay for now. If necessary, we can consider to expand that," he said. "We're going to gradually enlarge the exchange flexibility."
Currently, the yuan is allowed during each trading session to move within a 0.5 percent band on either side of a reference rate against the US dollar set by the central bank early in the day.
The central bank widened the band in May from 0.3 percent, a move seen at the time as an incremental step towards broader exchange rate reform.
Zhou did not give a time for when the next adjustment might take place, Xinhua said.
China in 2005 ended the fixed peg of the yuan to the dollar by allowing it to float within a relatively narrow range. But many leaders in the United States and Europe say that is not enough.
Zhou was in Cape Town for a meeting of central bankers and finance ministers from the Group of 20, a gathering of the world's largest economies.
11/19/2007 02:02 GMT